Providence see Blackrock as high prospect

A potential recoverable volume of up to 613 million barrels of oil has been identified by Providence Resources from its Blackrock prospect, the company's AGM was told today.

Shareholders heard that the exploration company has identified five target horizons could contain this amount.

Providence, as operator, currently holds a 50% interest in the Blackrock prospect and retains the right to increase its interest to 75% at any time during 2003.

To do this it must contribute an equivalent percentage of costs toward the 2003 work programme.

Midmar Energy Limited currently holds the remaining 50% interest.

The company has presented the prospect to various interested parties and hopes to progress to negotiations.

Providence also announced the award of two new Licensing Options, each for a three-year term, in the Celtic Sea and in St George's Channel.

As operator it holds an 80% interest in these new Licensing Options, with Midmar Energy Limited holding a 20% interest.

In Britain the company has focused on its Skye oil prospect in the Central North Sea - adjacent to the Witch Ground Graben - a prolific oil producing area.

The initial term of the licence is for two years from October 1, 2003 during which the planned work programme will comprise of the review and reprocessing of existing subsurface data.

Early indications, on an unrisked basis, show that Providence's combined interests could contain an estimated potential recoverable volume of up to 870 million barrels of oil equivalent, the company said.

Shareholders also heard that the company's directors believe there is potential for significant value leverage given Providence's current low market capitalisation.

Speaking at today's AGM, Dr Brian Hillery Chairman of Providence said: "We now operate the widest spread of interests in the Celtic Sea, an area in which we have built up considerable expertise. Our portfolio has significant potential for future success."